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Wednesday, December 03, 2025 | 11:06 PM ISTहिंदी में पढें
Hike in IPO financing limit: Maintain quality amid easier funding access
This short-term loan enhances the probability of allotment in oversubscribed issues, but also magnifies losses
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premium
The interest rate depends on the lender and the borrower’s profile. “It ranges from 7.5–18 per cent annually,” says Trivesh. Interest applies to the full loan amount, irrespective of allotment. | File Image
The Reserve Bank of India (RBI) has raised the ceiling for individual initial public offering (IPO) financing from ₹10 lakh to ₹25 lakh. The step is meant to widen participation by giving investors access to higher leverage for new issues.
“The higher limit will enable larger applications without switching to non-banking financial companies (NBFCs) and allow funds to become recurrently available after repayment,” says Trivesh D, chief operating officer (COO), Tradejini.
How it works
IPO financing is a short-term loan provided by brokers, banks and NBFCs. Investors pay only a margin, while the lender provides the
